Stability Amid Subtle Shifts

The market for RBD Palm Olein in July 2025 is showing signs of relative stability, with Malaysian CIF prices holding at USD 1,010–1,025 per metric ton (MT). While this represents a slight uptick from June, trading has largely remained within a narrow band. The current USD 60/MT margin between RBD Palm Olein and Crude Palm Oil (CPO) indicates stronger-than-average refinery margins, supported by steady throughput and stable pipeline inventories. In terms of export benchmarks, the Malaysian RBD Palm Olein FOB price is around USD 1,150/MT, while Indonesia’s CPO reference price for July stands at USD 877.89/MT, reflecting a 2.51% rise from June levels.

Much of the current demand dynamics are shaped by India, the largest importer of palm oil. Despite some volatility—evidenced by refiners cancelling nearly 65,000 MT of July–September crude palm oil cargoes due to margin pressures—India’s buying interest is expected to strengthen in the run-up to the August–October festive season, when consumption typically spikes. China is also adding momentum to the broader vegetable oil market, with plans to purchase 150,000 MT of soybean oil for September–December delivery, which indirectly lifts sentiment for palm olein. Customs data further highlight strengthening import flows into both India and China, underscoring their role as key demand anchors.

At the same time, the MENA region continues to play a stabilizing role, as consistent buying from markets such as Pakistan and Bangladesh helps absorb supply. The region’s preference for RBD Palm Olein is reinforced by its cost advantage and logistical ease, particularly with shipments via flexitanks and parcel tankers enabling rapid discharge. Together, these demand centers are helping balance out softer spots in the market, especially in India’s more cautious buying phases.

Navigating Policy, Seasonal Demand, and Strategic Margins

Beyond demand-side forces, policy and macroeconomic factors are exerting meaningful influence on prices. India’s lower import duties make palm olein more competitive compared to other vegetable oils, while seasonal demand—driven by the summer festive period—adds cyclical strength. On the supply side, Indonesia and Malaysia remain pivotal. Indonesia has maintained its 1:6 domestic market obligation policy for crude palm oil, ensuring steady export volumes, while its USD 52/MT CPO export duty in July sets an important benchmark for the region. Meanwhile, Malaysia’s ringgit depreciation against the USD is supporting its export competitiveness.

Year-on-year demand for palm oil and its derivatives remains in positive territory, with India recording solid import growth, backed by both duty advantages and consumption needs. Trading activity in key ports has stayed firm, reflecting the resilience of physical market demand even as refiners adjust margin strategies. Looking ahead to Q3 2025, market participants should anticipate a range-bound price trajectory, but with potential volatility tied to tender announcements and policy shifts. Adequate inventories are likely to keep supply balanced, though any adjustments in Indonesia’s export framework could alter competitive dynamics.

For refiners, the key will be maintaining flexibility. The USD 60/MT olein-CPO spread and freight-related challenges require careful margin management, while seasonal buying from India and strategic reserve tenders from China are set to guide short-term demand patterns. Overall, the outlook calls for a measured but steady approach, with traders and refiners closely monitoring shifts in import duties, consumption cycles, and policy moves from the world’s two largest producers.

 

Sources:

  1. RBD Palm Olein Market Snapshot: July 2025 Prices & Trends
    https://www.palm-chemicals.com/blog/rbd-palm-olein-july-2025-market-prices-trends

  2. Palm Oil Price Report on 28th Week (7th – 11th July 2025) [PDF]
    https://www.clal.it/upload/malesia11072025.pdf

  3. Palm Oil Price Report on 31st Week (28th July – 1st August 2025) [PDF]
    https://www.clal.it/upload/malesia182025.pdf

  4. Indonesia Palm Oil Export Duty – July 2025 (01-31)
    https://katadataku.com/indonesia-palm-oil-export-duty-july-2025-01-31/

  5. Palm Oil News - CPO Reference Price Rises to USD 877.89/MT for July 2025
    https://en.infosawit.com/news/15981/cpo-reference-price-rises-to-us--877-89-mt-for-july-2025--export-duty-reaches-us--52-mt